PHILHEALTH-ILOILO HOSPITALS REACH A COMPROMISE

Iloilo Hospitals’ Stand and Initial Dispute

St. Paul’s Hospital, Iloilo Doctors Hospital, Iloilo Mission Hospital, The Medical City Iloilo, Medicus Medical Center, Qualimed Hospital Iloilo, and Metro Iloilo Hospital and Medical Center Iloilo’s management was initially reported to be firm in their decisions to cut ties with PhilHealth after the unpaid claims reached up to P545 million on August 31, 2021, alone. The hospitals argued that the prolonged delay in reimbursements had severely impacted their operations, forcing them to consider withdrawing their accreditation. Without immediate action, they warned that the financial strain would compromise their ability to provide quality healthcare services to the public.

The mounting financial burden placed on these hospitals led to serious operational challenges, including difficulties in maintaining medical supplies, delays in staff salaries, and constraints in providing essential services to patients. Hospital administrators expressed concerns that if PhilHealth failed to settle its obligations, they would have no choice but to implement cost-cutting measures, such as reducing workforce numbers and limiting patient admissions. These measures, however, would have dire consequences for Iloilo’s healthcare system, particularly affecting low-income patients who rely on PhilHealth coverage for their medical needs.

Beyond financial concerns, the hospitals also raised issues regarding PhilHealth’s claims processing system, which they described as bureaucratic and inefficient. Many hospitals reported that claims were either denied without clear justification or subjected to lengthy verification procedures, causing significant delays in reimbursement. This inconsistent and unclear evaluation process left hospitals struggling to predict when they would receive payments, making it difficult to plan their budgets and sustain daily operations. Without a transparent and structured approach to handling claims, hospital officials feared that the problem would only worsen over time.

The situation also drew public attention and support from medical organizations, with the Philippine Hospital Association (PHA) backing the Iloilo hospitals’ demand for fair and timely reimbursements. Various healthcare advocacy groups emphasized that PhilHealth’s inefficiencies not only affected hospitals but also placed millions of Filipinos at risk of losing access to healthcare. The growing dissatisfaction with PhilHealth’s financial management prompted calls for government intervention, with some lawmakers urging reforms to improve transparency, enhance digital processing, and establish independent oversight to prevent further crises.

Reaching a Temporary Compromise

A compromise was reached between the seven private hospitals in Iloilo City and PhilHealth after a meeting between PhilHealth President and CEO Dante Gierran and the hospitals’ management from December 29-31, 2021. During that meeting, PhilHealth assured its commitment to fast-tracking the processing of claims through manual reconciliation and pledged to assign dedicated coordinators and evaluators to help facilitate claim approvals. This move aimed to reduce bureaucratic delays that had previously plagued the system and ensure that hospitals would receive their much-needed reimbursements in a timely manner.

PhilHealth also committed to paying more than P895 million in claims within 90 days. In exchange, the seven hospitals agreed to maintain their PhilHealth accreditation until the end of January 2022. The P895 million included claims related to both COVID-19 and non-COVID-19 cases up to November 30, 2021, providing some financial relief to hospitals struggling with operational costs. Additionally, PhilHealth promised to reconcile all pending claims submitted by the hospitals before the end of December 2021, ensuring that no further backlogs would accumulate.

Despite these assurances, hospital administrators remained cautiously optimistic, acknowledging that while the agreement provided temporary relief, it did not address the deeper systemic inefficiencies within PhilHealth. They emphasized that the success of the compromise would depend on PhilHealth’s ability to follow through on its commitments and implement long-term solutions to prevent future payment delays. Many hospital officials also expressed concerns that similar disputes could arise again if PhilHealth failed to modernize its claims processing system and introduce stricter financial management policies.

To solidify the agreement, both parties agreed to maintain regular meetings and progress assessments to monitor the status of reimbursements and ensure transparency in fund disbursement. Hospital leaders stressed that they would continue to advocate for reforms within PhilHealth, particularly in streamlining claims verification procedures and enhancing digital processing systems. While the temporary resolution prevented an immediate healthcare crisis in Iloilo, it also underscored the urgency of broader institutional reforms to secure a more stable and sustainable partnership between hospitals and PhilHealth in the long run.

Hospitals’ Response and Conditional Agreement

The seven hospitals released a joint statement, emphasizing that their decision to delay their disengagement was made out of consideration for the patients they serve. They stated, “In the spirit of humane consideration and with the prevailing Yuletide season as well as for the welfare of the Filipino people which the seven hospitals serve, we have agreed to suspend the planned disengagement that was scheduled to start on January 1, 2022, and give PhilHealth one more chance to fulfill its commitments up to January 31, 2022.” While this statement reflected optimism, hospital administrators remained cautious, noting that the temporary agreement was contingent on PhilHealth fulfilling its financial obligations within the given time frame.

Hospital administrators reiterated that their primary concern was the sustainability of healthcare services, particularly for patients who rely on PhilHealth coverage. While they acknowledged the necessity of granting PhilHealth additional time, they also warned that failure to meet the agreed-upon deadlines would force them to reconsider their participation in the program. Many of these hospitals were already struggling with financial constraints due to the prolonged delays in reimbursements, and another setback could push them to permanently sever ties with the agency.

In addition, hospital officials stressed the importance of establishing a more structured and transparent monitoring system to track the progress of PhilHealth’s payments. They proposed that both parties hold regular progress meetings to ensure accountability and provide updates on fund disbursement. Some hospitals also suggested creating a third-party oversight committee to independently assess whether PhilHealth was meeting its commitments and to prevent further mismanagement of funds.

Beyond the immediate crisis, hospital groups called on lawmakers and government agencies to implement lasting reforms in PhilHealth’s financial operations. They urged policymakers to introduce legislative measures that would streamline claims processing, minimize bureaucratic inefficiencies, and impose stricter penalties for delayed payments. Without these institutional changes, hospital leaders warned that future conflicts between PhilHealth and healthcare providers would be inevitable, ultimately putting the country’s healthcare system at risk.

Lingering Doubts and Skepticism

Despite the agreement, some hospital officials and healthcare groups remained skeptical about PhilHealth’s ability to deliver on its promises. Past experiences of delayed reimbursements and unmet commitments led many to question whether the agency could truly implement sustainable reforms. The fear was that once the deadline passed, hospitals would once again be left waiting for funds, leading to another cycle of financial uncertainty. Furthermore, some healthcare professionals raised concerns about whether the manual reconciliation process would be a temporary fix rather than a long-term solution to systemic inefficiencies.

Hospital administrators also pointed out that PhilHealth had made similar assurances in the past, only for delays to persist due to bureaucratic hurdles and financial mismanagement. They emphasized that without a clear, enforceable accountability mechanism, there was little to prevent the agency from repeating the same cycle of backlogs and delayed payments. Many hospitals remained cautious, stating that if PhilHealth failed to meet its obligations within the 90-day timeframe, they would have no choice but to push through with their disengagement plans, regardless of the consequences for patients reliant on PhilHealth coverage.

Moreover, concerns were raised about PhilHealth’s overall financial stability and whether it had the necessary funds to sustain long-term improvements in its claims processing system. Some industry experts warned that if the agency continued to struggle with cash flow issues, hospitals across the country—not just in Iloilo—could face similar crises in the future. As a result, healthcare groups and lawmakers called for a comprehensive audit of PhilHealth’s finances to assess its ability to meet its obligations and ensure that funds were being allocated efficiently and transparently.

The Road Ahead for Iloilo’s Healthcare Sector

As the January 31, 2022, deadline approached, both hospitals and PhilHealth faced mounting pressure to honor their commitments. For the hospitals, failure to receive the promised reimbursements could mean resuming their disengagement efforts, severely impacting PhilHealth members in Iloilo and beyond. Meanwhile, PhilHealth had to prove that it was capable of addressing long-standing inefficiencies in its claims processing system. Moving forward, healthcare experts emphasized the need for digital modernization, stricter financial oversight, and independent auditing to ensure that PhilHealth could regain the trust of both hospitals and the public. If meaningful reforms are not enacted, the possibility of future hospital disengagements and disruptions in healthcare services remains a significant concern.

 

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